Serving customers’ needs should be a top priority for power companies, irrespective of the regulatory construct and business model. Transformation doesn’t change this basic fact, but how do we...
Utilities hurry up and wait to apply for grant money.
by DOE to help support AMI deployments.
The Role of AMI
Many utilities have yet to develop a coherent smart-grid strategy but many recognize the central role that AMI plays at some point in their smart-grid implementation. For both state commissions and regulated utilities, AMI is clearly a central smart-grid application—enabling customer choice with advanced rates design predicated on hourly or sub-hourly data, in-home gateway choices and options through the home area network communication protocols and capabilities, net and bidirectional read capabilities to support distributed generation and advanced hybrid electric vehicles, end-of-line voltage and power- quality measures to enable distribution engineering applications, and disconnects to help manage and curtail loads. While there is a tendency to organize the smart-grid strategy around the role of the smart meter, it also is clear that the Recovery Act grant monies extend far wider than AMI-centric uses and applications.
One challenge utilities will have is how to organize their smart-grid plans around the needs for ubiquitous meter change outs while positioning for Recovery Act grant dollars aimed at extended uses and demonstrations of smart-grid capabilities that go far beyond the typical scope of AMI business-case evaluations. Moreover, given the precedent of numerous state mandates to deploy smart-metering systems, and many investor-owned utilities pursuing AMI systems and gaining regulatory recovery for these investments (with attendant regulatory findings around reasonableness, prudency and the meeting of the public’s interest) it isn’t clear that DOE would look favorably upon grant monies being used to fund AMI deployments.
More promising will be proposals that extend and enhance the scope of proposed or actual AMI deployments and offer transparency about the extent of costs and benefits associated with pursuing these extended and enhanced uses. Good examples are using the meter-enabled end-of-circuit voltage measurement to better manage transformer loads, and sizing and better balance voltage levels on distribution circuits. A proposal to aggressively and rigorously study such efforts and make results available to the smart-grid community (a grantee’s obligation as part of receiving funding) may receive more attention as a worthy funding priority within DOE.
Smart Grid Meets Recovery Act
The additional challenge in prioritizing smart-grid research, development and commercialization grants is to reconcile how these grants meet Recovery Act requirements around creating employment, stimulating economic activity otherwise, getting money spent quickly, buying American products, and ensuring that the grant dollars are non-duplicative. Many smart-grid deployment- oriented initiatives, for example, will take a long time to plan and implement; a typical AMI network can be deployed for several million dollars (not considering meters and IT systems), but only a handful of technicians are needed to mount a few hundred collectors and repeaters. Unless the utility already has selected an AMI vendor partner, the process of reviewing, selecting and negotiating with the AMI vendor partner will take at least twelve months and another six months of planning will follow before field work could be conducted. Assuming DOE takes six months to make awards, this implies a timetable of nearly two years before grant monies start circulating due to support of an AMI project. As